This time, the Federal Reserve's move is quite interesting. On the surface, it looks like a routine rate cut, but there are many subtle details behind the actual implementation.

First, the result: interest rates are lowered by 25 basis points, now in the range of 3.5%-3.75%. The accompanying overnight reverse repurchase agreements, standing repurchases, and reserve interest rates all move in tandem, directly reducing the market borrowing costs by one notch.

What’s truly noteworthy is the debt purchase plan. Starting December 12th, they will buy $40 billion worth of short-term Treasury bills within a month, and this intensity will be maintained for the next few months before gradually reducing. Many see this number and think it’s stimulus, but the actual goal is entirely different — it’s to repair liquidity channels.

Where’s the problem? Previously, balance sheet reductions withdrew too much money, leaving bank reserves tight. Meanwhile, short-term U.S. debt issuance is piling up, and year-end funding conditions are prone to issues. This operation is essentially adding water to the financial system’s pipes, ensuring banks can operate smoothly. It’s different from directly flooding the market with money to boost asset prices.

Now, regarding expectations adjustment: GDP growth rates and inflation data from 2025 to 2028 have been revised upward. Inflation is expected to continue approaching 2%, and the unemployment rate is projected to stay stable. But the official stance is transparent: there are still uncertainties about the economic trajectory.

The most interesting part is the internal disagreement: among 19 members, 6 oppose a rate cut in December, 12 support a 25 basis point cut, and 1 favors a 50 basis point cut. The dot plot remains unchanged, indicating ongoing debates about the future adjustments.

For the cryptocurrency market, a decline in short-term financing costs is positive. However, don’t expect this debt purchase round to directly push up risk assets like previous QE did. Improved liquidity and direct capital inflows are two entirely different concepts.